Lockdowns create fairly optimal conditions for social media platforms from a user engagement point of view, as consumers who can’t go out to see their friends and family are far more likely to log on to do so. Pinterest estimates that it picked up an incremental four million extra users a month care of the pandemic, while Snapchat CEO Evan Spiegel noted during the firm’s earnings call that the firm ended the quarter with 265 million active users, and that the average Snap user opens the app about 30 times a day. Clearly, these platforms have the eyeballs.
But the pressure is now on to monetize those eyeballs, and social brands are getting creative in how they’re doing that. Some have struggled to turn user attention into revenue of late. Pinterest, for example, saw accelerated user growth in 2020, but its revenue growth appears to have dipped below the trend, at least in the first half of the year — though things did revert more to normal in the latter half of the year. Pinterest also spent much of 2020 making efforts at monetizing previously unmonetized international users, which should mean stronger international revenue growth in future years.
As for the firm’s focus, Pinterest seems most keyed into developing its social commerce presence as a place where consumers go not only to discover goods — organically or through paid advertising — but also to purchase them directly. To that end, Pinterest has paired up with Shopify, which has drastically increased the goods inventory on its site. The firm has also been looking to upgrade its technology to better support shopping journeys, developing things like augmented reality (AR) and image recognition to make it easier for users to search the site for goods. The AR tech is enabling users to do things like virtually try on things like cosmetics before a purchase is made.
And Pinterest is far from alone in expanding its monetizable services, nor in trumpeting them loudly to investors. Snap’s Spiegel highlighted how much of the Snapchat platform is evolving toward capitalizing on the site’s features: “We are reorganizing our product team around the five core platforms on Snapchat — Map, Communication, Camera, Stories and Spotlight — which we believe will drive increased focus and operational excellence as we transition each platform into a monetizable business. We successfully made that transition with Stories, which we monetize with full-screen vertical video ads, and with our Camera, where businesses can pay to promote their Lenses. All of our platforms share the same powerful monetization infrastructure, which drives strong ROI for our advertising partners.”
Snap also shone a spotlight on, well Spotlight, its recently launched TikTok competitor, which as of January 2021 had 100 million users — and counting.
“While it is still very early in the development of this new content platform, we are highly encouraged by the initial results and excited about the potential for Spotlight to further expand our monetization opportunity in the future,” Snap CFO Derek Andersen noted.
Instagram Reels, a TikTok competitor, has stumbled out of the gate, but the photo-sharing wing of the Facebook social media empire is also pushing its own next-phase monetization strategy with a play for professionalism. Instagram is currently rolling out its “Professional Dashboard,” a management overview platform that provides basic performance insights and a suite of tools to help Instagram creators maximize and monetize their platform presence.
“As part of our ongoing effort to give creators and businesses the tools they need, we are launching Professional Dashboard, a central destination to track performance, access and discover professional tools, and explore educational information curated by Instagram,” Instagram noted in a statement.
The dashboard lets Insta creators view key trends and data notes based on account performance, and provides tools to help them grow their businesses, including Badges, Branded Content and IGTV promotions. The site will also offer access to tips, tricks and guidance for managing their sites. It’s not a major addition, as these features all existed before, but this is the first time they’ve been centralized for user convenience. Instagram plans to build on the platform’s features over time, in an effort to make Insta Business as accessible to as many users as possible.
Finally, rounding out the social media players’ early 2021 moves to make their platforms more efficient money-makers, Twitter has recently announced its purchase of Revue, a newsletter platform that allows users to create, customize and distribute newsletters to a proprietary list of email subscribers and get paid for their efforts. Revue also offers Twitter a chance to diversify its revenue streams, according to a report in The Wall Street Journal, with the social platform recently speculating about the possibility of “identifying subscription opportunities.”
“Revue will accelerate our work to help people stay informed about their interests while giving all types of writers a way to monetize their audience — whether it’s through the one they built at a publication, their website, on Twitter or elsewhere,” said Kayvon Beykpour, Twitter’s product chief, and Mike Park, vice president of publisher products, in a joint statement about the purchase.
Twitter, notably is the outlier in terms of user growth in 2020. While Instagram. Pinterest and Snap all saw their users bases expand, Twitter’s was largely stagnant.
Beykpour and Park explained that Revue will dovetail seamlessly with Twitter, allowing people to sign up to the newsletters of their “favorite follows” directly from Twitter and driving conversations back to Twitter for further engagement, either directly on the Twitter platform or via “new settings for writers to host conversations with their subscribers.” Creating two-way traffic for Twitter and creators aims to grow subscribers, increase “conversational experiences” on Twitter and capitalize on monetization opportunities.
But even the growing platforms are facing questions about the 2021 expansions, and about how much of that soaring interest they will hold when the pandemic slips into memory. And investors will be looking to gauge well they manage to turn last year’s influx of users into a new stream of money.
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